International Funds

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a copy of any document affecting the rights of participants in the scheme (note,

this is different to the requirement for a s264 application);

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a copy of the authorization from the home (Designated Territory) regulator con-

firming that the scheme is of a class covered by the designation order.

Again the FSA will wish to be notified if there are any changes to the information

which has been supplied.

The FSA has powers to refuse recognition of a s270 scheme under S271.

Section 272 – schemes individually recognized by the FSA. This covers schemes that

require recognition in their own right – that is, because they are constituted outside

the EEA or the countries having Designated Country Status. The procedure for recog-

nition is more lengthy than under sections 264 or 270, because the FSA does not have

the comfort of knowing that the scheme has already been reviewed by another regula-

tor which it know to have similar investor protection standards to its own.

The section might also include a fund that was constituted in a Designated Territory

or EEA Member State, but which was unable to achieve the right status in its home

territory because some of its features were outside the scope of the local legislation. In

this case, it might still be possible for the scheme to be acceptable under the UK provi-

sions (and indeed this has on occasion happened).

Such schemes make an application (not a notification). Their application will con-

tain almost exactly the same information as for s270 schemes. However:

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it ill not include a confirmation from the local regulator that the scheme falls into any

category covered by a Designated Territory order (because, of course, it does not);

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the prospectus must include a statement that says ‘Complaints about the operation

of the scheme may be made to the FSA;’

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the prospectus must state whether or not investors would be covered by the United

Kingdom’s Compensation Scheme; if so how and who to contact. This is not neces-

sary for s264 and s270 schemes since these should be covered by schemes in their

own countries.

The FSA has powers to refuse recognition of a s272 application under s276.

10.3 Facilities to be maintained by foreign schemes recognized

in the United Kingdom

Foreign schemes recognized for sale in the United Kingdom under sections 264, 270

or 272 of the FSMA are required to maintain certain facilities at an address in the

United Kingdom, intended to make life easier for their UK investors. The address

must be disclosed in the Prospectus and will most likely be the scheme operator’s prin-

ciple place of business in the United Kingdom.

The facilities must include somewhere where investors can, free of charge:

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inspect the constitutional documents of the scheme (and any documents amending

them);

Distribution regimes 197